TSX.V: ROK
VANCOUVER, April 29 /PRNewswire-FirstCall/ - Roca Mines Inc.
(TSX-V: ROK) ("Roca" or "the Company") has released its financial
results for the three and six months ended February 28, 2010, including production and sales
from the MAX Molybdenum mine located in British Columbia, Canada. All dollar amounts
are stated in Canadian dollars unless otherwise indicated.
Q2-2009 Highlights
- MAX Molybdenum mine subsequently awarded British Columbia's 2009
Mining and Sustainability Award;
- Revenues of $7.1 million for September 1, 2009 to February 28, 2010;
- Cash costs of $12.26 (US$11.58) per lb of molybdenum produced during
the six months ended February 28, 2010;
- Q1 and Q2 average molybdenum recoveries of approximately 95%; and
- Q1 and Q2 molybdenum in concentrate production of 362,633 pounds and
305,485 lbs respectively.
MAX Molybdenum Mine - Production Results and Concentrate
Sales
Revenues of $7.1 million for the
six months ended February 28, 2010
result from shipments during the period and reflect final and/or
estimated final pricing at February 28,
2010. The Company sells its concentrates to a UK-based buyer
with sales revenues based on average prevailing molybdenum oxide
prices subsequent to delivery.
The table below summarizes the average operating statistics for
the three months ended February 28,
2010:
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MAX Mine Statistics Q2-2010
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DEC '09 JAN '10 FEB '10 TOTAL
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Molybdenum Produced
(lbs)(1) 82,962 106,897 115,626 305,485
Average Head Grade
(% Mo) 0.30 0.38 0.38
Molybdenum Recovery
(%) 94 96 96
Mill Availability
(%) 97 100 100
Average Daily
Throughput (tpd) 420 432 511
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Note 1: molybdenum contained in concentrate.
The MAX Mine and concentrator continue to operate at targeted
Phase I throughput rates with good efficiency and excellent
recovery. However, ore produced from the single production area
during the first and second quarters has returned average head
grades that are below targets. In October
2009, the mine experienced dilution due to a failure caused
by the intersection of previously unknown structures in the 805m
level stope, impacting molybdenum production well into January 2010.
New development plans and future stoping methods will minimize
the possibility of such an occurrence on the next levels of the
mine. Development crews are now advancing on the 780m level where
head grades for the operation are expected to improve.
Cash costs of production during the second quarter were higher
than previous quarters as a result of these low average grades
received at the mill. Cash costs averaged $14.09 per lb (US$13.40) of molybdenum sold during the second
quarter. For the six months ended February
28, 2010 cash costs averaged Cdn$12.26 (US$11.58) per lb of molybdenum sold. At
February 28, 2010, the Company had
readily saleable concentrates in inventory containing approximately
45,000 lbs of molybdenum by weight.
The grade management challenges encountered over the last two
quarters highlight the mine's current dependency on a single
producing stope. The development of multiple stopes in the Phase
II, 1000 tpd plan will reduce the impact of the production
difficulties encountered during late 2009 and early 2010.
Financial Results
The information in this news release and the selected financial
information should be read in conjunction with the interim
consolidated financial statements, and management discussion and
analysis, for the period ended February 28,
2010, which will be available at Roca's website at
www.rocamines.com.
During the six months ended February 28,
2010, the Company recorded production revenues of
$7,132,426 and a net loss of
$1,873,039. The Company had negative
operating cash flows of $175,737
during the period, which was offset by $447,993 in proceeds from outstanding option and
warrants. The Company reported revenues of 11,577,854 and a loss of
$11,850,042 during the six months
ended February 29, 2009 on
significantly higher sales of molybdenite concentrates during the
prior year (and higher depletion charges under the Phase I mine
plan). General and administrative expenses decreased over the prior
year reflecting the Company's continuous efforts to reduce
costs.
Despite significantly lower production during the three months
ended February 28, 2010, production
revenues improved to $4,055,486 with
a net loss of only $507,197 due to
higher prevailing prices for molybdenum based products. The Company
had revenues of $3,267,337 and a loss
of $6,728,318 during the three months
ended February 29, 2009 on
significantly lower realized prices for concentrates in the prior
year.
Summary Consolidated Statements of Operations and Loss
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Three months Six months
ended ended
February 28, February 28,
2010 2010
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Total Revenues 4,055,486 7,132,426
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Operating expenses (3,853,074) (7,862,888)
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Depletion, amortization, accretion (213,771) (838,553)
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Mining Loss (11,359) (1,569,015)
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G&A, Stock-based comp., write-offs (528,556) (956,650)
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Loss from Operations (539,915) (2,525,665)
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Exchange gain (loss) and other income (loss) (29,440) (131,161)
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Income and mining tax provision 62,158 783,787
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Net Loss for the Period (507,197) (1,873,039)
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Loss per Share - Basic and Diluted (0.01) (0.02)
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Outlook
It remains management's belief that recent global events have
seriously eroded the supply of molybdenum and management contends
that a realization of supply and demand fundamentals in the
medium-term will result in positive changes to pricing. It is
therefore management's goal to accelerate production at MAX to 1000
tpd to reduce unit costs and to preserve the opportunity to produce
concentrates in an appreciating price environment.
Exploration work at the Company's various projects has been
limited recently to preserve cash resources. The Company has
recently completed a short program at the Nuevo Milenio gold/silver
project at relatively low cost, as expenditures towards mine
expansion and operating efficiencies continue to be management's
priority.
ROCA MINES INC.
"David Skerlec"
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David J. Skerlec - Chief Financial Officer
The TSX Venture Exchange does not accept responsibility for the
adequacy or accuracy of this release.
SOURCE Roca Mines Inc.